Mellon Bank Corp., Pittsburgh, is going after the large-plan 401(k) retirement market.

This month the banking company formed the Dreyfus Defined Contribution Investors Group and tapped Philip A. Mercurio, former president of GE Investment Retirement Services, to be its president.

The unit will offer defined-contribution plans to some of the 200 large- plan sponsors that already use Dreyfus for defined-benefit programs, said Francis D. Antin, chief operating officer of Dreyfus Institutional Investors.

Defined-contribution plans are pension plans in which employees invest their own dollars. They differ from defined-benefit programs, under which employers make contributions for their employees.

To qualify as a large plan, a company must have at least 5,000 participants and investable assets of $300 million, said Mr. Antin. He declined to name companies Dreyfus will target.

"Large plans are making frequent changes to their lineup of products and swapping managers in and out," said Mr. Antin, explaining the decision to target that market. In the large-plan market, Dreyfus is offering "investment-only" products, meaning it will offer investment management services but not record keeping or related services. Dreyfus, which manages $350 billion of assets, said it will offer proprietary investments to employees along with several other options.

"Before, the trend was to go with one provider," Mr. Mercurio said. But now plans "have to accommodate other fund families."

Most large plans now give investors up to eight choices, he said. In addition to a choice of provider, plans want a broad array of investment options.

Dreyfus' recent asset management acquisitions have let it offer that, said Ann Mahrdt, a senior consultant at Spectrem Group, a San Francisco consulting firm. For example, last year's $275 million deal for Founders Asset Management, Denver, added a growth mutual fund management style to Dreyfus' mix, she said.

From the large-plan sponsors' perspective, choosing multiple providers lets them "put together a best of class" in selecting investment products, she said. So they can select the best international or growth fund from a range of providers, she explained.

Mr. Antin said he plans to staff the new defined-contribution group with up to 10 people and expects the unit to be fully operational by early next year.

Mellon is not the first banking company to take an investment-only strategy to the large-plan market, said Ms. Mahrdt. Several others, including J.P. Morgan & Co. of New York and State Street Corp. of Boston, offer investment-only plans to the endowment market through their trust divisions, she said.

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